Unit 6 Controlling

UNIT - 6: CONTROLLING AND COORDINATION: STRUCTURE Overview Headlines Learning Objectives Learning Outcome 6.1 Introduction 6.2 Controlling Inside Business Application Self-Analysis Quick Recap 6.3 Control Process Self-Analysis Quick Recap 6.4 Essentials of Effective Control System Inside Business Applications Self-Analysis Quick Recap 6.5 Budgetary and Non-Budgetary Control Self-Analysis Quick Recap 6.6 Control Techniques Self-Analysis Quick Recap 6.7 Coordination 1

6.7.1: Need 6.7.2: Types 6.7.3: Techniques 6.7.4 Requisites for coordination Self-Analysis Quick Recap 6.8 Contemporary issues of management- 6.8.1Ethics 6.8.2 Change Management 6.8.3 Customers 6.8.4 Diversity. 6.9 Summary 6.10 Key Terms and Definitions 6.11 Answers for Self-Analysis 6.12 Terminal Assessment a) Multiple Choice Question b) True or False c) Match the following d) Essay Questions f) Case study/Caselets 6.13 Answers for Terminal Questions a) Multiple Choice Question b) True or False c) Match the following 6.14 Post reading reference material 2

Text Books Reference Books Weblinks 6.15 Topics for Discussion Forum OVERVIEW The importance of coordination as a management function stems primarily from the possibility that multiple activities could lead to the organization's objectives being neglected in the absence of coordinated efforts. Control refers to assessing actual performance and, if necessary, taking corrective action. HEADLINES Control is the process by which Managers ensure that performance is an conformity with the plans and goals. The control process is flexible, not static, and the system remains effective as long as it changes according to the business’s requirements. The process involves eliminating deviations from the set standards through corrective actions. Contemporary issues in managing change include resistance to change, lack of clear goals and objectives, insufficient resources, lack of commitment from senior management, embracing technological change, and building a culture of change LEARNING OBJECTIVES • Understand the concept of controlling and coordination • Acknowledge the importance of controlling • Recognize the important elements of effective control system • Understand the concept of coordination • Understand the different controlling techniques • Recognize the contemporary issues of management 3

LEARNING OUTCOME • Comprehend the fundamentals of controlling process • Understand the contemporary issues of management • Enumerate the various techniques of coordination • Understand the types of controls • Acknowledge the need of coordination for sustainability and growth of organisation 6.1 INTRODUCTION In order to ensure the successful achievement of organisational goals, controlling in management is a cyclical process that entails comparing actual performance with the established standard of the company. Setting standards, assuring implementation, authentic execution, and taking corrective action in the event of deviations are all crucial managerial tasks for the controlling function in management. Controlling is the final function of management. The instruments for establishing control over corporate activities, monitoring them, and taking the appropriate remedial action are known as controlling techniques. For effective business control, a number of Traditional and Morden strategies are accessible. Technique selection must follow a strategic plan. The organisation must examine the following factors before deciding on the best technique: Nature and Area of Business Target and prospectives Customers Problems faced by the Organizations Every organisation is unique and operates in a particular way. Therefore, there isn't a control system that works for all organisations. 4

Some Morden and Traditional approaches assess the entire process, while others merely examine a portion of it. So, gaining control over the organisation requires more than one strategy. As a result, they integrate a few different strategies to produce a powerful control scheme. 6.2 CONTROLING One of the most essential qualities required in a manager is that he should command the respect of his team. This allows him to direct and control their actions. In fact controlling is one of his more important functions. Let us learn the importance and meaning of controlling function. Meaning of Controlling Controlling is one of the important functions of a manager. In order to seek planned results from the subordinates, a manager needs to exercise effective control over the activities of the subordinates. In other words, the meaning of controlling function can be defined as ensuring that activities in an organization are performed as per the plans. Controlling also ensures that an organization’s resources are being used effectively & efficiently for the achievement of predetermined goals. ● Controlling is a goal-oriented function. ● It is a primary function of every manager. ● Controlling the function of a manager is a pervasive function. How Controlling Function Helps Managers 5

Managers at all levels of management Top, Middle & Lower – need to perform controlling Commented [DVM1]: Nature of Controlling? function to keep control over activities in their areas. Therefore, controlling is very much important in an educational institution, military, hospital, & a club as in any business organization. Therefore, controlling function should not be misunderstood as the last function of management. It is a function that brings back the management cycle back to the planning function. Thus, the controlling function act as a tool that helps in finding out that how actual performance deviates from standards and also finds the cause of deviations & attempts which are necessary to take corrective actions based upon the same. This process helps in the formulation of future plans in light of the problems that were identified &, thus, helps in better planning in the future periods. So from the meaning of controlling we understand it not only completes the management process but also improves planning in the next cycle. Nature of Controlling 1. Controlling is a goal-oriented function of management. It aims at ensuring that the resources of the organisation are used effectively and efficiently for the achievement of pre-determined organisational goals. 2. Controlling is a continuous process. It means that once the actual performance and standard performance of a business are compared and corrective actions are taken, the controlling process does not end. Instead, the firms have to continuously review the performance and revise the standards. 3. Controlling is all-pervasive. It means that the controlling function is exercised by the firms at all levels of management. The extent of control and nature of the function may vary at every level. Also, a controlling process is required in both non-business and business organisations. 4. Controlling process is both a forward-looking and backward-looking function. As a forward- looking function, it aims at improving the future performance of an organisation on the basis of its past experiences. However, as a backward-looking function, it measures and compares the actual performance and planned performance (fixed in past) of the organisation. 6

Importance of Controlling After the meaning of control, let us see its importance. Control is an indispensable function of management without which the controlling function in an organization cannot be accomplished and the best of plans which can be executed can go away. A good control system helps an organization in the following ways: 1. Accomplishing Organisational Goals The controlling function is an accomplishment of measures that further makes progress towards the organisational goals & brings to light the deviations, & indicates corrective action. Therefore it helps in guiding the organisational goals which can be achieved by performing a controlling function. 2. Judging Accuracy of Standards A good control system enables management to verify whether the standards set are accurate & objective. The efficient control system also helps in keeping careful and progress check on the changes which help in taking the major place in the organization & in the environment and also helps to review & revise the standards in light of such changes. 3. Making Efficient use of Resources Another important function of controlling is that in this, each activity is performed in such manner so an in accordance with predetermined standards & norms so as to ensure that the resources are used in the most effective & efficient manner for the further availability of resources. 4. Improving Employee Motivation Another important function is that controlling help in accommodating a good control system which ensures that each employee knows well in advance what they expect & what are the standards of performance on the basis of which they will be appraised. Therefore it helps in motivating and increasing their potential so to make them & helps them to give better performance. 5. Ensuring Order & Discipline Controlling creates an atmosphere of order & discipline in the organization which helps to minimise dishonest behaviour on the part of the employees. It keeps a close check on the 7

activities of employees and the company can be able to track and find out the dishonest employees by using computer monitoring as a part of their control system. 6. Facilitating Coordination in Action The last important function of controlling is that each department & employee is governed by such pre-determined standards and goals which are well versed and coordinated with one another. This ensures that overall organisational objectives are accomplished in an overall manner. Important Concept Controlling is a systematic exercise which is called as a process of checking actual performance against the standards or plans with a view to ensure adequate progress and also recording such experience as is gained as a contribution to possible future needs. Self-Analysis - 1 1. Controlling is an end function of managment (True/False) 2 Controlling is only for top level management of organisation (True/False) Quick Recap One of the main goal-oriented management duties in an organisation is controlling. To make sure that activities are carried out in accordance with the plans and to take corrective action if necessary, it is a process of comparing the actual performance with the company's established standards. 8

6.3 CONTROLLING PROCESS Control, as used in the management definition, is a process that entails keeping track of, comparing actual performance to established criteria, and then taking appropriate corrective action as needed. The systematic activity aids businesses in planning in addition to facilitating collaboration inside the organisation. 1. Establishing goals and standards Setting goals and standards is a process that is done while planning, but it also has a significant impact on controlling. This is so because controlling's primary goal is to steer an organization's behaviour in the direction of its objectives. If an organization's members are clear on its objectives, they will devote all of their attention to attaining them. It is crucial for managers to convey the goals, standards, and objectives of their organisation in the clearest manner possible. Employees must always be on the same page in this matter. 9

An organisation has a better chance of succeeding if everyone works towards shared objectives. Managers must create and strive towards objectives that might be either concrete and detailed or vague and general. Goals that are easily quantified in numbers are considered tangible. For instance, reaching sales of Rs. 100 crores in a single year is a measurable objective. In contrast, intangible objectives are those that cannot be measured mathematically. For instance, a business might want to receive a prominent award for its efforts in CSR. 2. Measuring actual performance against goals and standards Managers should measure and compare their actual performance after determining their goals. In essence, this stage aids them in determining whether their plans are succeeding as intended. Managers must continuously monitor and assess plans after they are put into action. They must constantly be prepared to make adjustments if anything isn't working well. They should continuously contrasting their present performance with their eventual objectives in order to accomplish this. This process control stage, in addition to helping managers take corrective action, also aids them in foreseeing potential issues. This enables them to act quickly and prevent losses to their company. Managers must first measure their real performance in order to compare it. They can achieve this by employing methods such as financial results measurement, consumer feedback gathering, hiring financial specialists, etc. If managers wish to gauge immeasurable standards like employee relations, brand reputation, etc., this can frequently become challenging. 3. Taking corrective action 10

Managers need to act right away to make up for any differences between actual performances and goals. Corrective measures taken in a timely manner can both cut losses and stop them from happening again in the future. Business organisations will occasionally create policies that serve as default corrective actions. However, when dealing with complex issues, this might be challenging to accomplish. Managers in these situations must first quantify the fault and plan a course of action to fix it. For unforeseen issues, they can occasionally need to take unusual actions. 4. Analysing Deviations An organization's standards and actual performance are rarely in line with one another. Typically, there is always some difference between the performance that is anticipated and what occurs. Analysing the deviations is the fourth step in the controlling process. An organisation must establish an acceptable performance range to achieve this. Additionally, a company should place more emphasis on large deviations and less on minor ones. Managers of an organisation typically use Critical Point Control and Management by Exception to accomplish this. A) Critical Point Control Critical point control, an organization's control system should place more emphasis on the Key Result Areas (KRAs), which are essential to its overall performance. An organisation cannot easily or cheaply monitor every action with the same level of focus. Therefore, it needs to focus more on the crucial areas that determine how well the entire company performs. An organisation should concentrate on the deviation in its production cost since it is a crucial area and can impact the organization's profitability, for instance, if there is a 2% deviation in the production cost and a 15% departure in the stationery expenditures. 11

B) Management by Exception According to the theory of \"Management by Exception,\" which is based on the adage \"If you try to control everything, you might end up controlling nothing,\" an organization's manager should concentrate on large deviations that exceed the established deviation limit. To do this, managers must determine a range of acceptable performance deviations, and any departure that deviates from that range must be addressed. For instance, the manager of a company set a 5% tolerance for production cost variance. Now, if the company's manufacturing costs vary by 2%, the managers can disregard the variation. If the divergence, however, is 10%, it requires quick care. . 4. Following up on corrective action Taking remedial action is the last and most important phase in the controlling process. There is no need to take remedial action if the deviations are within the management' established acceptable ranges. However, appropriate and prompt managerial actions are needed if the deviations exceed the established acceptable limit in the critical areas. Through corrective actions, an organisation can quickly fix any issues with its real performance. For instance, if the organization's real performance deviates from expectations due to a shortage of resources, the managers work to find solutions to the problem. However, if the actual performance differs due to the employees' lack of abilities, the management may provide the relevant and necessary training to the employees. Managers should continue working on the issue until it is resolved. If they assign it to a subordinate, they must remain present to see that he finishes the job. They might even assign him a personal mentor so that he can learn how to handle these issues on his own in the future. 12

What is the Control Cycle? The control cycle is the iterative process of planning, monitoring outcomes, assessing results, and making revisions. The control cycle is commonly applied to the ongoing revision of corporate budgets and process flows. When applying the control cycle to budgeting, the expectation is that each successive version of the budget will be improved, based on the information gleaned when the initial budget is compared to actual results. This approach works well in an environment where the level of competition is relaxed and few new products are released. The results are more problematic in a fast-paced environment, since business models may be radically revised on a regular basis, so there is little time to gain the benefits of an iterative feedback loop. When to Use the Control Cycle The control cycle works best for process flows, since they tend to change less than business models - that is, there will still be a need to pay suppliers, issue invoices, ship goods, and so forth, irrespective of changes in the business model. Given the higher stability level of processes, one can continually work through the steps in the control cycle to make processes more efficient, while also more closely monitoring risks. Important Concept Managerial control entails measuring performance against the benchmark and adjusting deviations to ensure that goals are attained in accordance with plans. Self-Analysis - 2 1. Taking remedial action is the last and most important phase in the controlling process (True/False) 13

2 Measurement of performance standards is the very firsts step in controlling process. (True/False) Quick Recap Commented [DVM2]: Control Cycle? Controlling entails comparing an organization's actual performance to its planned performance and adopting corrective measures as necessary if the real performance deviates from the intended performance. Although variations between actual and planned performance cannot be prevented, they can be minimised through control by making corrective decisions and actions that can lessen their recurrence. 6.4 ESSENTIALS OF EFFECTIVE CONTROL SYSTEM Every company needs control to make sure everything is running smoothly. Therefore, every manager needs to have a reliable and sufficient control system to help him ensure that things go as planned. Control, however, does not operate automatically; rather, it needs specific design. The fundamental concepts involved in developing a control system for an organisation may be universal, but the system itself needs to be designed specifically for that organisation. There are some prerequisites for this customised control system that should be kept in mind. 1. Simplicity: In order for all managers to use a control system effectively, it must be straightforward and simple to understand. Complex control methods fall short in explaining to managers the significance of control data. 2. Realism: The performance standards should be realistic, precise, quantifiable, and verifiable. They ought to be founded on facts in order to make control palatable and practicable. 3. Promptness: 14

The control system should deliver information quickly enough for managers to identify and report deviations promptly, allowing for the proper timing of the necessary corrective measures. If corrective action is performed too late, it is useless. 4. Economy: The control system must make the associated costs justifiable. In other words, the projected profits from it should exceed the projected operating expenses. A tiny business cannot employ the pricey control method used by large corporations. 5. Flexibility: Internal objectives and plans must be adaptable to environmental changes, and the control system must be adaptable enough to deal with unforeseen circumstances. It need to be capable of evolving with new advances. Alternate plans can be created to bring flexibility into the control system. 6. Accuracy: The control system should encourage accurate information in order to detect deviations. The technique of control used should be appropriate to the work being controlled. 7. Suitability: The control system should be focused on attaining the organisational goals. Control must reflect the needs and nature of the organization's activities. 8. Forward-looking Nature: The direction of the control system must be forward-looking. It must consider how future activities will fit in with the adopted plans. 15

9. Focus on Strategic Points: Attention should be given by the control system to critical or strategic deviations. Only extreme deviations demand the managers' attention. 10. Motivating: A good control system should take into account the human element and be built to encourage productive behaviour from the workforce. Self-control typically has a driving force. Making the control system motivating also requires direct communication between the controller and the controlled. 11. Reflection of Organisation Pattern: Control must correspond to organisational structure. Since events are managed by people, it is crucial that controls follow the organisational structure. On a psychological level, the control process should be ok. 12. Corrective Action: Corrective actions must be ensured by the control system. A good control technique should not only be able to identify deviations and failures, but also reveal where they are happening, who is in charge of them, and what has to be done to fix them. Important Concept Effective control requires consistency with the position, operational responsibility, ability to understand, and needs of the individuals concerned Self-Analysis – 3 1. Control should be objective, definite, and determinable in a clear and positive way. (True/False) 2 All control systems and techniques should reflect the functions they are to perform. (True/False) 16

Quick Recap • Control system should motivate both controller and controlled. While • planning and control are necessary for economical operations, researches in human relations show that planning and control are, more often than not, antagonistic to good human relations 6.5 BUDGETARY AND NON BUDGETARY CONTROL Budgetary Control When actual outcomes are compared to budgeted results, budgetary control is used to ensure that any discrepancies between the two are addressed appropriately. Budgetary control is a strategy for cost management that entails creating budgets, organising departments and assigning roles, assessing performance against the plan, and acting on the findings to maximise profits. Budgetary control involves the following steps: Creation of different budgets. Comparisons between actual and budgeted performance are ongoing. Budget revisions made in light of new conditions. A budgetary control system shouldn't get too rigid. There should be sufficient room for adaptable personal initiative and drive. The organisation can become a valuable instrument for cost management and accomplishing overall goals by using budgetary control. Types of Budgetary Controlling Techniques Budgetary control is a system for monitoring an organization’s process in monetary terms. The Types of budgetary controlling techniques Financial Budgets. Operating Budget. Non-Monetary Budgets. 1. Financial Budgets 17

Such budgets detail where the organization expects to get its cash for the coming period and how it plans to spend it. Usual sources of cash include sales revenue, the sales of assets, the issuance of stock, and loans. On the other hand, the common uses of cash are to purchase new assets, pay expenses, repay debts, or pay dividends to shareholders. Financial budgets may be of the following types: a. Cash budget Simply put, this is a projection of cash inflows and outflows against which actual cash \"experience\" is evaluated. Because it divides incoming and outgoing funds into monthly, weekly, or even daily periods, it gives businesses a crucial control that helps them make sure they can pay their bills as they become due. The cash budget also demonstrates the presence of extra funds, allowing for the planning of surplus investments that will yield a profit. b. Capital expenditure budget This kind of financial budget focuses on significant assets like a new plant, property, or machinery. Organisations frequently borrow substantial sums to purchase these assets, for instance through long-term bonds or securities. Due to the significant investment often connected with capital expenditures, all organizations—large or small, for-profit or nonprofit—pay particular attention to such a budget. c. The balance sheet budget 18

It forecasts what the organization’s balance sheet will look like if all other budgets are met. Hence it serves the purpose of overall control to ensure that other budgets mesh properly and yield results that are in the best interests of the organization. 2. Operating Budgets This type of budget is an expression of the organization’s planned operations for a particular period. They are usually of the following types: a. The sales or revenue budget It focuses on the income the organization expects to receive from normal operations. It is important since it helps the manager understand what the future financial position of the organization will be. b. The expense budget It outlines the anticipated expenses of the organization in a specified period. It also points out upcoming expenses so that the manager can better prepare for them. c. The project budget It focuses on anticipated differences between sales or revenues and expenses i.e. profit. If the anticipated profit figure is too small, steps may be needed to increase the sales budget or cut the expense budget. 3. Non-monetary budgets Budgets of this type are expressed in non-financial sales or revenues and expenses, i.e. profit. If the anticipated profit figure is too small steps may be needed to increase the sales budget or cut the expense budget. a. Fixed and variable budgets Regardless of their purpose, most budgets must account for the three following kinds of costs: 19

b. Fixed costs They are the expenses that the organization incurs whether it is in operation or not. Salaries of managers may be an example of such a cost. c. Variable costs Such costs vary according to the scope of operations. The best example may be the raw materials used in production. If $5 worth of material is used per unit. 10 units would cost $50, 20 units would cost $100 and so on. d. Semi-variable costs They also vary, but in a less direct fashion. Costs for advertising, repairs, and maintenance, etc. may fall under this category. All these categories of cost must be accurately accounted for in developing a budget. Fixed costs are usually the easiest to deal with. Variable costs can also be forecast, although with less precision from projected operations. Semi-variable costs are the most difficult to predict because they are likely to vary, but not in direct relation to operations. For these costs, the manager must often rely on experience and judgment. Types of Budgets Budgets can be classified as per the following basis. Based on Area of Operation. Functional Budgets. Master Budget. Based on Capacity Utilization. Fixed Budget. Flexible Budgets. 20

Based on Time. Short Term. Medium Term. Long Term. Based on Conditions Basic Budget. Current Budget. Benefits of Budgetary Control Planning and managing both rely heavily on budgeting. It assists in putting the limited resources to the best possible use and so ensures organisational effectiveness as a whole. The advantages that an organisation receives from a successful budgeting system can be summed up as follows. The creation of a budget makes it easier to organise numerous operations and ensures that the organisation operates in a methodical and efficient manner. Since creating a budget requires coordination, it incorporates the ideas from several levels of management. Since no budget can be created in a vacuum, cooperation between multiple departments is always made easier. In order to increase profitability, planning and regulating income and expenses is aided by budgeting, which also serves as a guide for various management choices. Budgeting is a useful tool for planning that guarantees adequate operating capital and other resources are available. Evaluation of the actual performance using preset parameters is absolutely required. With the use of budgeting, it is possible to have clearly defined parameters against which to measure performance. Budgeting assists in lowering wastage and losses since resources are allocated to the most fruitful uses. 21

Non-Budgetary Control Techniques Of course, there are numerous conventional controls that have nothing to do with budgets, even though some of them might be tied to and utilised in conjunction with budgetary controls. Statistical information, specialised reports and analyses, break-even point analysis, the operational audit, and personal observation are a few of the most crucial of these. 1 Statistical data: Of course, it is crucial to control that numerous parts of a corporate operation are statistically analysed, and that statistical data—whether historical or forecast—is presented clearly. Although most managers prefer the presentation of the data on charts, certain managers can easily interpret tabular statistical data. 2 Break- even point analysis: An interesting control device is the break even chart. This chart depicts the relationship of sales and expenses in such a way as to show at what volume revenues exactly cover expenses. 3 Operational audit: The internal audit, or operational audit as it is increasingly referred as, is another efficient managerial control instrument. In its broadest definition, operational auditing refers to the ongoing, independent evaluation of a company's accounting, financial, and other operations by a team of internal auditors. 4 Personal observation: In any preoccupation with the devices of managerial control, one should never overlook the importance of control through personal observation. Inside Business Applications Important Concept Control with the help of financial resources is called budgetary control techniques 22

Control over the organization other than the financial resources are called as non – budgetary control techniques. Non budgetary control techniques are classified into: Traditional techniques Modern techniques Self-Analysis - 4 1. Financial budgets detail where the organization expects to get its cash for the coming period and how it plans to spend it. (True/False) 2 The budgets should be rigid in nature (True/False) Quick Recap • Budgetary control is essentially a strategy that compares the real results, or actual revenues and expenses, with the budget that was set before the start of the financial year. • It draws attention to the necessity of, if necessary, adjusting the performance. • It also demonstrates how well management have kept costs and operations in check during an accounting period. 6.6 CONTROL TECHNIQUES In the subject of management, there are numerous controlling approaches accessible. We can categorise them into the following two major categories: Traditional Techniques Modern Techniques 23

1. Personal observation It is the earliest conventional approach still in use to carry out the managing task. The boss in this instance personally observes the workers in the workplace. It can be summed up simply as On-the-Spot or Direct Observation. Direct observation puts employees under pressure and inspires them to perform as efficiently as possible. This method, meanwhile, takes a lot of time during monitoring. Using it offers the advantage of providing accurate, first-hand data for the analysis. Additionally, in the event of underperformance, management have the ability to make changes immediately. 24

In addition to the advantages listed above, staff can simultaneously discuss difficulties or challenges. Additionally, it improves employee morale. 2. Break-Even analysis With varying output levels, this control technique shows the link between Cost and Volume. The Cost, Volume, and Profit analysis is another name for it. In reaction to changes in output levels, it forecasts profits and losses. The break-even point is reached when the cost price and selling price are equal. 3. Statistical Reports The manager gathers information to evaluate performance in functional areas. Moreover, they use the collected information for comparison purposes. It involves the analysis of the numeric data in the form of: Averages Percentages Co-relation Ratios, etc The organization presents the above information via Charts, Graphs, Tables, etc. These reports help visualize the data and identify the areas that demand attention. Hence, it is the most used and helpful technique for data analysis. 4. Budgetary Controls A crucial traditional control method used in planning and controlling operations is budgetary control. It encompasses the key operations' planning and comparisons of that planning to actual performance. The comparison and evaluation of actual and budgeted performance is a step in the budgeting process. The following activities are included in the budgeting process: By dividing the overall business goals into departmental targets, standards are created. Comparison of the performance against the predetermined Budget/Standards. 25

Determine the logical departures from the plan and take the necessary corrective action. Daily activity control is made easier by budgetary control. It evaluates the availability of resources and labour needed to meet corporate objectives. The budget that was created can end up being exorbitant and wrong. The following are examples of the many budgets that businesses typically create: Cash Budget Sale Budget Production Budget Capital Budget Material Budget Morden Methods The management literature has expanded to include Morden control strategies. These are relatively new and offer cutting-edge techniques for organisational evaluation and control. Morden control techniques are additions to the management literature. These are of recent origin and provide innovative methods for organizational evaluation and control. Return on Investment Financial Statement and Ratio Analysis Responsibility Accounting Management Audit PERT & CPM Management Information System Return on Investment Return on Investment (ROI) is the profit earned by invested capital. It is analyzed to attain financial control in the business. It is also known as the Du-Pont System of financial analysis. To measure the generated return, we calculate the rate of ROI. This rate helps assess the financial position of the business. ROI Formula: 26

Return on Investment As per the technique, we can increase ROI in two ways: By raising sales volume relatively greater than the total investment. Reducing total investment without reducing sale volume. So, we can understand it as the usage of invested capital in generating returns. Moreover, organizations must aim to earn a reasonable ROI. It helps in: Comparing the wealth between the two periods and companies Attract investors and improve the goodwill of the company Finding areas that adversely impact the ROI Interdepartmental comparisons Financial Statement and Ratio Analysis It helps in controlling the finances of the organization by calculating different Ratios. For this purpose, data is accumulated from the firms’ financial statements. The most extensively used Ratios are as follows: Profitability Ratios Liquidity Ratios Solvency Ratios Turnover Ratios Responsibility Accounting It is an accounting system that depends upon the responsibility assigned to the employee. So businesses conduct an evaluation of the employee’s ability to fulfil the assigned responsibility as per set standards. This control technique is suitable for large organizations containing many departments. Generally, responsibility centres are of four types: 27

Revenue Centre Cost Centre Profit Centre Investment Centre Management Audit Management or Internal Audit is the examination of the utilization of the company’s resources. The Top-level initiates it to ensure the efficient performance of the management. Internal Auditing starts as soon as the financial audit ends. During the audit, the overall management process is critically evaluated. However, conducting a management audit is not compulsory for organizations. PERT & CPM PERT is Program Evaluation and Review Technique, whereas CPM stands for Critical Path Method. These control techniques are used explicitly for project management and evaluation. The activity or project’s success is largely affected by the time taken and steps involved. Therefore, managers strive to cut the total time and cost involved in completing the activity. It focuses on the efficient execution of the project. But the execution must be within the stipulated time and predetermined costs. Management Information System Management Information system (MIS) basically provides information for effective decision- making. Managers can retrieve any data as and when needed. It is one of the cost-effective controlling techniques available for managers. Moreover, it provides information at the right time and helps manage a huge bundle of data. The information obtained from MIS is accurate and facilitates decision-making. MIS has two major components: Data Collection Data Management 28

Inside Business Application Think about Organisation In order to ensure effective resource allocation and team collaboration, ABC places a greater emphasis on the control process than any other management function. All superiors at all levels of management delegate tasks to the subordinates, who are subsequently evaluated on their performance. By evaluating each employee's performance and that of the company's owners, Jim and Mike can get knowledge of the activities and efforts of every employee. They can then determine whether employees deserve a bonus, promotion, or raise by comparing their performance to the targeted outcomes. Important Concept The instruments for establishing control over corporate activities, monitoring them, and taking the appropriate remedial action are known as controlling techniques. For effective business control, a number of Traditional and Morden strategies are accessible. Self-Analysis - 5 1. Statistical reports refers to analyzing data and reports presented to an organization’s managers to give them an idea regarding the business’s performance in different areas., (True/False) 2 Responsibility accounting is a useful technique that helps determine whether the business has been able to utilize the available capital efficiently. (True/False) Quick Recap • Over the years, management theorists and specialists have developed a number of strategies. • They frequently separate these methods into two groups: conventional and modern. Traditional methods tend to emphasise unconventional approaches. 29

• On the other hand, more exact scientific approaches are the foundation of contemporary techniques. 6.7 CORDINATION For management to be successful in accomplishing company goals, they must get and utilise resources like people, materials, money, and machines to the best of their abilities. Managers have the resources available to them for a variety of interconnected tasks and operations. In order to effectively achieve the organization's goals, many actions and efforts must be planned, coordinated, and carried out in a systematic way. A company organization's varied activities are divided up and carried out in distinct departments. Again, there are divisions and sub- divisions of activities inside each department based on the kind of responsibilities required. By coordinating individual and group efforts, these divisions, sub-divisions, and departments' activities are to be monitored. Only via coordination is this possible. Coordination is the function of management which ensures that different departments and groups work in sync. Therefore, there is unity of action among the employees, groups, and departments. It also brings harmony in carrying out the different tasks and activities to achieve the organization’s objectives efficiently. Coordination is an important aspect of any group effort. When an individual is working, there is no need for coordination. Therefore, we can say that the coordination function is an orderly arrangement of efforts providing unity of action in pursuance of a common goal. In an organization, all the departments must operate a part of a cohesive unit to optimize performance. Characteristics of Coordination: The definition that is furnished above highlight the following characteristics of coordination: Coordination intergrates group efforts 30

Coordination brings unity of action Coordination is a continuous process Coordination is a pervasive function It is the responsibility of all other managers to coordinate. An intentional (planned) function is coordination. 6.7.1 Need of Cordination The importance of coordination is that it unites the efforts of individuals, authorities, and professionals. The primary analysis for coordination is based on the interdependence of the company's departments and employees, who depend on one another for information and resources to carry out their respective tasks. As a result, managers must resolve differences in time, strategy, interest, or effort. Goals for both the organisation and the individual must be in line with one another. Size expansion: The number of employees at a corporation grows along with the organisation's size. It may become difficult to coordinate their efforts and workouts frequently. Everyone differs in their background customs, ways of thinking, responses to situations, and relationships with others. It becomes crucial to ensure that everyone contributes to the company's pre- established common goals. Employees could, however, also have individualised objectives. Functional differentiation: A company's operations are divided up into departments, sections, and divisions. There may be separate departments for production, marketing, finance, or human resources in a firm. Each of these units may have unique objectives, plans, and working methods. Specialisation: Today's organisations are characterised by their intense specialisation. The complexity of modern technology and the diversity of activities that must be completed lead to specialisation. Therefore, businesses need to hire a variety of professionals. Most experts 31

believe they are qualified to evaluate, make judgements, and make decisions based on their professional standards. They typically don't listen to advice or opinions from others when it comes to things pertaining to their area of expertise. Division of Labour The requirement for coordination for these operations is also created when managers divide work into specialised departments or functions. The demand for coordination increases when there is more work division. Clash of interests : There is a possibility of conflict between the personal goal of the employee and the organisational goal. Sometimes they may pursue their own specialised interests at the expense of the larger organisational goals. Coordination helps to avoid conflict belween individual and organisational goals. It brings about harmony between the two types of goals. Different outlook : Every individual has his own way of working and approach towards problems. Capacity, talent and speed of the people differ widely in any organisation. Therefore, it becomes imperative to reconcile differences in approach, ' timing and effort to secure unity of action. By resolving the differences and bringing about unity coordination helps in creating congenial atmosphere in the organisation. Interdependence of units: Various units of an organisation depend upon one another for their successful functioning. The output of one unit serves as the input of another unit. Therefore, the need for coordination increases with an increase in the interdependence between organisational units. 6.7.2 Types of coordination The effective coordination of internal and external components inside an organisation helps to lessen complexity (internal and external). As a result, the organisation sees an increase in productivity, easier integration of micro and macro level organisational dynamics, better 32

connections between roles among intra-organizational and inter-organizational groups as well as building trust among antagonistic groups, and definition of organisational tasks. As shown below, there are two main types of cooperation: internal coordination and external coordination. Internal Coordination Establishing a connection between all of the managers, executives, departments, divisions, branches, and employees or workers is the main goal of internal coordination. In order to coordinate the organization's actions, these connections are made. Two groups make up internal coordination: Vertical Coordination A senior authority coordinates their work with that of their subordinates in a process known as vertical coordination. A sales manager might plan his tasks with his sales supervisors, for instance. However, every sales supervisor makes sure that they collaborate with the sales manager. Horizontal Coordination : Employees of the same status create relationships with one another in horizontal coordination in order to perform better. For instance, cooperation between department heads, managers, employees, etc. In other words, in internal coordination, an employee either reports vertically to the supervisor and/or the subordinates and horizontally to the colleagues and/or co-workers. External Coordination External coordination is aimed at establishing connections between the employees in a business organization with people outside of the organization. The goal of external coordination, as its 33

name suggests, is to build connections between the organization's personnel and those beyond its walls. These connections are made in order to gain a better understanding of external parties such as market agencies, the general public, competitors, clients, governmental organisations, financial institutions, etc. Establishing friendly ties between the organization's employees and outsiders is often the role of a Public Relations Officer (PRO). 6.7.3 Techniques of Coordination By this point, it should be evident that coordination is not something that can be ordered by an executive, but rather something that the executive brings about as he effectively and efficiently fulfils his managerial duties. The following list of management strategies is accessible to an executive to achieve coordination: 1 Coordination through procedures or rules: One may foresee the conclusion with ease if the job is highly structured and the necessary procedures have been established to carry it out. Subordinates use rules and procedures as a work manual while making decisions as part of their routine tasks. Managers can easily specify in advance the necessary activities to be taken by their subordinates through rules and procedures. 2. Coordination by departmentalisation: Departmentalization in business can achieve organisational coordination depending on the type of organisation. Different departmentalization structures make it easier to coordinate. For instance, functional organisation places a high degree of interdependence on departments. Coordination of the company's overall production, marketing, finance, and other functions requires a lot of work from the top executive. However, the head of the product division will have his or her own manufacturing, marketing, and finance departments that are under his or her command and control in the departments that fall under the product organisation. 3.Coordination by simplified organisation: An effective method of coordination is a straightforward and sound organisation. The organisational structure's lines of power and responsibility should be distinct from top to bottom. Relationships of authority that are clearly defined help to prevent conflicts and hold people accountable. One department or unit should 34

contain all related activities. Avoid overspecialization since it tends to turn each unit into a self-contained entity. 4. Effective communication — The secret to coordination is frequent, honest communication. Mutual understanding and conflict resolution are facilitated by effective opinion and information exchange. Face-to-face interactions are the most efficient form of coordination and communication. Committees aid in fostering departmental cohesion and consistency of approach. 5. Leadership and Supervision: Effective management and supervision ensure coordination during both the planning and implementation phases. A good leader can motivate his followers to work together to achieve shared goals and steer their efforts in the appropriate direction. Effective leadership can persuade followers to have a common perspective and to have a common identity. Personal supervision is a crucial strategy for settling disagreements. 6. Chain of command — The highest level of organisational coordination is authority. The conventional method of coordination is the exercise of power through the chain of command or hierarchy. By placing all interdependent units under one boss, coordination may be guaranteed. 7. Liaison departments — Liaison officers may be recruited in situations when regular communications between various organisational units are required. A liaison department, for instance, might make sure that the production department adheres to the delivery deadlines and requirements that the sales department promised. In specific circumstances, special coordinators may be chosen. To coordinate the efforts of various officials in a project that must be finished within a given time frame, for example, a project coordinator may be appointed. 8. General staff: In sizable organisations, coordination is handled by a centralised pool of staff experts. All departments of the company receive their information and expert guidance from a single staff group. Such general staff is particularly beneficial for creating horizontal or cross-departmental coordination. Teams for projects and task forces can both help with coordination. 9. Self-coordination occurs when each organisational unit recognises the operations of related units and adapts its own operation to suit them. A culture of commitment and reciprocal cooperation is conducive to self- or voluntary coordination. It comes about as a result of 35

teamwork and mutual consultation among the organization's members. It cannot, however, take the place of managers' coordinated efforts. 6.7.4 Requisites for coordination 1. Direct Contact: Direct communication with the parties involved should be used to achieve coordination. Direct personal communication leads to consensus on strategies, actions, and eventual success. Additionally, it prevents red-tapeism and guarantees quick response. Coordination is best accomplished through direct communication. 2. Early Beginning: Early on in planning and policy-making, coordination can be accomplished more easily. Direct communication must therefore start very early in the process. There will be problems if an order has been placed for the supply of a specific commodity but the raw ingredients needed to make it are not readily available. At an early stage, communication between the purchasing manager, production manager, and sales manager would have made it feasible to determine whether the order could be fulfilled. 3. Continuity: Co-ordination must be maintained as a continuous process. It starts from planning and ends when the objective is accomplished. Whenever there is division and distribution of functions among the managers and departments, co-ordination is necessary. Every time a new situation arises, a fresh effort of co-ordination is needed. So, the manager must constantly work at it until the purpose is served. 4. Reciprocal Relationship: 36

All of the variables in a situation—production, sales, finances, people, and management— should be viewed as having a reciprocal relationship. For instance, each of the four individuals finds himself influenced by the others when \"P\" collaborates with \"Q\" and \"Q\" collaborates with \"R\" and \"S\" in turn. 5. Pervasiveness: In every managerial function, coordination is a pervasive activity. At every level of the organisation, it is necessary for all actions. Both inside and outside the organisation, it must be used. 6. Leadership: The most efficient tool for coordination is leadership. The coordinator of the group's activities is a leader. He coordinates everyone in the group's activities. A manager neither produces nor sells anything in the market on his own. He obtains the goods created by the employees and arranges for their market sale by the salespeople. In fact, he oversees numerous tasks and acts as a leader. 7. Timing: An essential component of coordination is timing. This principle emphasises the necessity of doing all tasks inside the company simultaneously and swiftly. The sales department can deliver the goods to the customers in accordance with the specified time if the purchasing department purchases and supplies materials to the production department promptly and if manufacturing is completed promptly. 8. Balancing: This principle refers to the quantitative element of co-ordination. It means that all works are to be done in right quantity. For instance, if a department produces half, another one-third and the third the full quantity, their activities cannot be balanced. They have to perform their job in right quantity for achieving co-ordination of their jobs. 37

9. Integrating: The corporate purpose must be realised by integrating all actions, judgements, and viewpoints. All men and departments must carry out their duties at the appropriate times in order for integration to take place. For instance, if all of the machine's components are produced by the various departments at the appropriate time, the machine can be put together in the allotted amount of time. Coordination is the process of putting the machine's components together. Important Concept Coordination means synchronising multiple departments' efforts to lessen conflict. Typically, an organization's various departments work together to complete its objectives. Self-Analysis - 6 1. Coordination harmonizes synchronizes and unifies individual efforts for better action and for the achievement of business objectives. (True/False) 2 Coordination increases interdepartmental conflicts (True/False) Quick Recap All the other managerial functions are connected by coordination. It is the common thread that connects all operations, including production, acquisition, financing, and sales, in order to ensure the establishment's continued operation. Rarely is coordination considered to be a distinct managerial function. 6.8 CONTEMPORARY ISSUES OF MANAGEMENT- Over the past few decades, management has seen significant change. Any department within an organisation, whether it be marketing, finance, human resources, operations, or sales, has 38

experienced changes due to modernization and automation, computerization and customization, laws, and social obligations. Business operations and decisions have been impacted by the nation's current economic situation, including GDP, inflation, and the balance of payments. The slowdown in the economy and the current economic standing of different nations have also changed the management and leadership styles. On managerial activities, what effect, if any, recent issues like cross-cultural training, innovation in product design, emotional intelligence, corporate social responsibility (CSR), business ethics, corporate governance, quality of work life and quality circles, workforce treatment and workforce discrimination, and transparency will have Key indicators are now being monitored and managed by many businesses. There is strong evidence that solving these problems will immediately reduce costs and save money. As a result, they can assess how management theory is being used in the firm and how such practises are being implemented, particularly those that may have an impact on the organisation's reputation. Some of the key issues are as follows 6.8.1 Ethics Business ethics refers to implementing appropriate business policies and practices with regard to arguably controversial subjects. Some issues that come up in a discussion of ethics include corporate governance, insider trading, bribery, discrimination, social responsibility, and fiduciary responsibilities.. Some issues that come up in a discussion of ethics include corporate governance, insider trading, bribery, discrimination, social responsibility, and fiduciary responsibilities. Several large corporations have been involved in scandals and unethical behaviour that has at one point or another caused public mistrust. The definition of ethics is \"character or customs.\" In order to avoid doubts and scepticism, the organization's rules and bylaws must reflect moral integrity and principles in serving the public. Other organisations, however, are worried about the higher uniformity, utility, and specificity of ethics. The morally right and widely accepted values that are consistent with one's own personal values are the subject of ethical behaviour. Many people in an organisation might wonder whether some behaviours were morally acceptable, such as: Is it appropriate to do personal business on company time? Is it unethical 39

to urge someone to perform a task that might be detrimental to their ability to advance professionally? As a result, we can describe business ethics as the judgement of what is right or wrong in a company's actions and procedures 1. Harassment and Discrimination in the Workplace The biggest ethical problems affecting business owners today, in my opinion, are harassment and discrimination. If harassment or discrimination occurs at work, the consequences could be disastrous for your company's finances and reputation. The anti-discrimination laws and rules that are in place to safeguard employees from unfair treatment must be understood by every organisation. 2. Health and Safety in the Workplace As outlined in the regulations stipulated by the Occupational Safety and Health Administration (OSHA), employees have a right to safe working conditions. According to their 2018 study, 5,250 workers in the United States died from occupational accidents or work-related diseases. On average, that is more than 100 a week, or more than 14 deaths every day. The top 10 most frequently cited violations of 2018 were: However, health and safety concerns should not be limited to physical harm. In a 2019 report conducted by the International Labour Organization (ILO), an emphasis was placed on the rise of “psychosocial risks” and work-related stress and mental health concerns. Factors such as job insecurity, high demands, effort-reward imbalance, and low autonomy, were all found to contribute to health-related behavioural risks, including sedentary lifestyles, heavy alcohol consumption, increased cigarette smoking, and eating disorders. 3. Whistleblowing or Social Media Rants 40

The widespread nature of social media has made employees conduct online a factor in their employment status. The question of the ethics of firing or punishing employees for their online posts is complicated. However, the line is usually drawn when an employee’s online behavior is considered to be disloyal to their employer. This means that a Facebook post complaining about work is not punishable on its own but can be punishable if it does something to reduce business. In a similar spirit, business owners must be able to appreciate employees who report illegal activity to regulatory agencies or on social media without retaliation. This means that employees shouldn't be discouraged from reporting workplace infractions online, and they also cannot be punished for doing so. For instance, a Yelp employee wrote a blog post about the terrible working circumstances she was allegedly facing at the online review company on the blogging platform Medium. After that, she was let go for breaking Yelp's rules of behaviour. Her case's ambiguity—whether her tweet was justified or evidence of spiteful and disloyal behavior—illustrates the value of establishing explicit social media policy inside an organisation. 4. Ethics in Accounting Practices Any organization must maintain accurate bookkeeping practices. “Cooking the books”, and otherwise conducting unethical accounting practices, is a serious concern for organizations, especially in publicly traded companies. 5. Business espionage and nondisclosure Many employers run the danger of information theft from current and former employees, including client data exploited by businesses that are directly competitors. Corporate espionage occurs when confidential customer information or stolen intellectual property is improperly shared. To deter these kinds of ethical transgressions, businesses may implement obligatory nondisclosure agreements with high financial penalties in the event of a violation. 6. Privacy and Technology Practises 41

The advancements in technology security capacity raise privacy concerns for both clients and staff under the same general heading as nondisclosure agreements. Employers may now keep an eye on what their employees are doing on their laptops and other company-issued devices. While electronic monitoring is supposed to increase productivity and efficiency, it frequently errs dangerously close to violating employee privacy. 6.8.2 Change Management Change is something that business organisations must deal with frequently today. Organisations must modernise and alter their business outlook, job duties, and even their overall aims in reaction to external market drivers and disruptors as technologies continue to transform entire industries. Priorities are addressed and redistributed as organisations reorganise their labour force to match new objectives, with some employees taking on new duties. For managers hoping to guarantee all forms of transitions remain as seamless as possible, developing a standardised organisation approach to change has become increasingly crucial as a result of their staff having to deal with such a diversity of change. Change management is useful in this situation. The difficulty of managing change is exacerbated by the lack of consensus regarding the variables that have the greatest influence on transformational endeavours. Asking five executives to identify the one element essential to the success of these programmes would likely provide five different responses. This is due to the fact that every manager approaches an effort from a unique perspective and, based on personal experience, focuses on various success elements. Additionally, leaders employ various strategies throughout the organisation, which exacerbates the turbulence that frequently accompanies change. Resistance to change is a common obstacle in organizational change initiatives. Employees may resist change for a variety of reasons, including fear of the unknown, a sense of attachment to the current way of doing things, and a lack of understanding of the benefits of change. Organizations must address employee resistance by involving them in the change process, communicating the reasons for change, and providing support and training to help employees adjust to new processes and procedures 42

6.8.3 Customers Customers typically respond in one of two ways when your firm undergoes external upheavals. First off, they might be amenable to the modifications, especially if they don't need a significant change in attitude or behaviour and won't force them out of their comfort zone. Customer resistance to the move, though, is a possibility. Usually, this occurs when they have to modify how they communicate with your company, whether it be in person, online, through an app, or in the physical world. In this situation, it will be more probable that your adjustments will have detrimental long-term impacts. Here's how business owners and entrepreneurs may involve customers in the transition process so they feel more like partners and stakeholders in 1. Analyse issues from the perspective of the clientele: The other person must mentally accept the change in order for it to take place. While it could be simple to implement regulatory and legislative changes, most customers are more interested in having their requirements addressed than in the reasons why things must happen a specific manner. Test out the modifications with your customers to involve them in the process from the start. Talk about the advantages as you walk them through the modifications and conditions. Most importantly, pay attention to what they have to say. Even if you are unable to address all of their issues, acknowledging and listening to your clients' worries will frequently persuade them to accept your modifications. 2. Involve your consumers in the ecosystem: Quite frequently, changes made in one part of the system will have an effect on other parts of the system. Consider your company as a fully functioning, breathing ecology. At each interaction with this ecosystem, ask your customers how they felt. Also collect statistics about their usage of your product, including when, when, how, and why. Encourage online reviews of your new product or service by offering incentives to your 43

customers. With the support of your customers, you may build a self-sustaining business environment by having them sell your goods. 3. Don't assume everyone is connected: As technological development accelerates, those of us who live in larger urban areas may mistakenly believe that everyone is connected to the same extent. Those who have less connectivity must be Be sure to have a technical workaround so consumers who live in an area with lower bandwidth have a great customer experience as well. 4. Build real intelligence: Make sure you are measuring the success of your firm with the appropriate metrics. Although we may consider sales to be a success statistic, this alone won't always indicate whether your improvements are successful. Is it a good indicator for your specific business if a customer made a purchase but never returned? You may get a better understanding of how successful your modification was by tracking ongoing client involvement with your business. 5. Maintain data accuracy: Make the proper inquiries. Make sure customers can access tracking, shipment, profile, and other pertinent information regarding your goods or service in real time. Percentages should be understood in context. For instance, if 60% of your consumers rated the product favourably but that proportion only includes a small proportion of your client base, the information is useless. Don't forget to consider both quantitative and qualitative data. Anecdotal evidence can be just as reliable as objective statistics in identifying trends that need your attention. Also, take both quantitative and qualitative data into account. Anecdotal evidence can be just as strong as hard data and signify trends you should pay attention to. 6. Manage expectations: Be absolutely upfront with your clients about what they may anticipate at each stage of the customer experience. Don't be reluctant to make it clear and 44

straightforward for them. People who are going through a variety of changes are curious about what the future will bring, what will remain the same, and what will change. 7. Develop a strong customer relationship: Keep in mind that purchasing tactics have evolved. More options than ever are available to your customers. Create and uphold a solid connection with them. Make your customer feel like a member of your company rather than just a consumer of your goods. Inform them of your responsibilities and the services you will offer. Give customers a sense of ownership with your business, product, and service. 8. Be rigorous but flexible: There must be rigour, understanding, and adherence to the change management process for creative changes to be successfully introduced to your customers. While having the discipline to put out a detailed strategy, host meetings, and gather input is necessary, you also need to be adaptable enough to change with the environment in which your organisation operates. 6.8.4 Diversity The advantages of diversity in the workplace are numerous. Diverse viewpoints, beliefs, and concepts can spur greater innovation and improved problem solutions. This can assist businesses in providing better customer service, expanding into new areas, and gaining a competitive edge. An inclusive workplace may also help members of historically underrepresented groups feel more a part of the community. An employee may feel more at home on the team after they are no longer the lone woman, person of colour, or somebody with a disability. Higher employee engagement, fewer turnover, and improved productivity may result from this. But bringing together a varied group of people might also provide some difficulties. Communication issues On heterogeneous teams, communication problems can occur frequently and for a variety of reasons. Your team may include members who have hearing impairments, various 45

communication preferences or styles, or language barriers. It's crucial to handle these difficulties before they become an issue. Consider the case where you discover a difference in communication preferences between generations. Your younger team members use Slack for communication, whereas your senior team members favour phone calls. For both groups, some direction on when and how to use each platform would be very helpful. In other words, you may recommend Slack for rapid queries and informal contact while using the phone, in-person meetings, or Zoom sessions for longer, more in-depth discussions. Cultural misunderstandings When you mix individuals from various cultures, misunderstandings can also occur frequently. For instance, in some cultures, giving someone the thumbs up, using your left hand, or patting them on the back is disrespectful. Creating a diverse workplace can assist the aggrieved team member in recognising a miscommunication for what it is. People are more likely to extend the benefit of the doubt to others when they have faith that their teammates accept their differences. A diverse workplace will foster an atmosphere where team members are open to criticism and instruction when they say or do something that could be considered offensive. Each team member may contribute to making the workplace more inclusive by using teachable moments to learn more about diverse cultures. 46

Slower decision making While many viewpoints, opinions, and ideas are excellent for innovation, they can often impede goal-setting and decision-making. For instance, a team member who questions the status quo in a meeting might raise a crucial issue that need more investigation. Allow teams more time to evaluate other viewpoints, discuss them, and make more well- informed judgements in order to create the space for this to occur. Allowing people to speak up, even in a field outside of their competence, has numerous advantages. Discrimination D&I—diversity and inclusion—must work together. Inform your staff of the significance of each and establish guidelines for behaviour through a code of conduct. Throughout the employee lifecycle, including during hiring and onboarding, as well as during team meetings, talk about your D&I goals and progress. That D&I is a priority and that discrimination will not be tolerated should be made very plain to everyone. Important Concept Management in the changing society has become important to all because of its universal application, and therefore, contemporary issues on management provide basics on the effectiveness of work-life of individuals and groups who work at different situations in competitive world environment Self-Analysis - 7 1. Managing a workforce for global operations is not only comprised of a few employees but a largegroup of managers, executives, specialist and professionals, making it a challenging task, (True/False) 47

2 Decision making becomes easy and quick with diverse workforce (True/False) Quick Recap Implementing proper corporate policies and practises with regard to apparently contentious matters is referred to as practising business ethics. A methodical strategy to dealing with the transition or transformation of an organization's objectives, procedures, or technologies is called change management. Implementing ways for bringing about change, managing change, and assisting individuals in adapting to change is the goal of change management. 5.7 SUMMARY Setting standards, assuring implementation, authentic execution, and taking corrective action in the event of deviations are all crucial managerial tasks for the controlling function in management. Controlling is the final function of management. The behaviour of other departments or systems in a firm is managed, ordered, directed, or regulated by a control system. Control, as used in the management definition, is a process that entails keeping track of, comparing actual performance to established criteria, and then taking appropriate corrective action as needed. Coordination is the synthesis and integration of all business operations to accomplish a certain objective. Business ethics as the judgement of what is right or wrong in a company's actions and procedures 48

5.7 KEYWORD– • Controlling: Controlling is the process of making sure that an organization's workers and employees perform in a way that advances a common objective. • Formal: using an agreed and often official or traditional way of doing things • Pervasiveness: existing in or spreading through every part of something. • Chain of command: An organisational hierarchy as a result of delegating authority sequentially from the top down to the first -line supervisors. • Coordination: Achieving harmony of individual and group efforts towards the accomplishment of group purposes and objectives. • Cooperation: The collective efforts of people who associate voluntarily to achieve specified goals. 5.8 ANSWERS FOR SELF-ANALYSIS 1. Self-Analysis – 1 1.True 2.False: It is applicable for all levels of organisation Self-Analysis – 2 1.True 2.False: Setting standards is the first step in controlling process Self-Analysis - 3 1.True 2.True Self-Analysis - 4 1.True 2.False: budgets should be flexible to incorporate any changes in organisation 49

Self-Analysis - 5 1. True 2.False: ROI is a useful technique that helps determine whether the business has been able to utilize the available capital efficiently. Self-Analysis - 6 1.True 2.False: coordination decreases conflicts in organization Self-Analysis - 6 1.True 2.False: decision making becomes slow with workforce diversity 5.9 TERMINAL ASSESSMENT a) Multiple Choice Questions 1. The two types of coordination are (a) Internal and External (b) General and Specific (c) Interior and Exterior (d) Real and unreal 2. Controlling is known as a backward-looking function because _____. (a) It relates to a future course of action. (b) It is like a post-mortem of the past activities (c) To find out deviation, it aims at improving future performance. 50